As you know, the Employee Retirement Income Security Act (ERISA) issues requirements governing private pension, group life, and all health plans offered to your employees. One of those requirements involves a Summary Plan Description (SPD) for those benefits, issued when a new plan takes effect or when an employee becomes eligible to participate in the plan. These SPDs must also be issued upon request of any plan participant or beneficiary.
Failure to follow procedures set forth by ERISA can result in litigation. Luckily these issues are easily avoided by keeping all SPDs up to date.
What information is covered by the SPD?
According to HGLaw.org, your SPD must include the following information:
- A description or summary of the benefits
- The plan name, sponsor, and administrator
- Funding mechanisms
- Participation and qualification guidelines
- Calculation methods for service and benefits
- Benefit vesting schedules
- Benefit payment procedures and timing
- Claims submission process
- Claims appeal process
- Address for service of legal process
- Circumstances that may result in ineligibility or a denial of benefits
- A statement of participants’ ERISA rights and other technical notices
How often must I provide employees with a copy of their SPD?
Providing this information to employees is your legal responsibility, and a new copy must be issued every ten years. Or, if any plan is amended or modified during a five-year period, a new SPD must be distributed.
What else should I do?
All ERISA compliance issues are complicated legal matters, and assistance from an ERISA compliance specialist is highly recommended. Your tax and legal advisors can guide you in matters regarding 1095 A forms, 1095 C forms, Affordability Calculations, and other related topics.
You should also contact us about ERISA Summary Plan Description Wraps, to create one overall plan document and SPD. For more information, we can refer you to an ACA and ERISA Compliance company that has an expertise in this area.